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Steelcase French factory to be closed down

Thursday 15 April 2010

Steelcase announced today that it had decided to close its factory in Marlenheim in North East France, one of its three remaining plants in the country.
The closure, to take place by the end of 2010, will entail 105 job cuts out of 202, according to trade unions. Steelcase management said it would transfer 97 workers from Marlenheim to its nearby plant in Wisches.
Some jobs may be created also at the North Eastern French site of Sarrebourg and the German sites of Rosenheim and Durlangen.
The company expects to incur up to $15 million of cash restructuring costs in connection with the closing and relocation of jobs, with the majority relating to workforce reductions and some additional cost for manufacturing consolidation and production moves. Depending on the progress of discussions with the Work Councils, the amount of restructuring costs incurred in the financial year 2011 for this project could range from $10m to $15 million. The Company anticipates annualised cost savings from the changes would be $7 to $8 million when fully implemented by the end of the financial year to 28 February 2012.
Steelcase announced a 30% fall in sales in the year to 28 February 2010 and incurred a loss for the second year in a row. The current fall in the office furniture market is seen to be having long-lasting effects on production volumes, prices and competition, the company said.